India has recently voiced strong objections to what it perceives as double standards exhibited by the European Union (EU) and the United States, particularly concerning trade relations with Russia and the EU's proposed carbon tax. These concerns have been amplified by renewed threats from the U.S. to impose tariffs on Indian goods.

One major point of contention revolves around the EU and the U.S. criticizing India's continued import of Russian oil, while simultaneously engaging in substantial trade with Moscow themselves. India's External Affairs Minister, S. Jaishankar, has criticized the "double standards" of the U.S. and the EU, warning that punitive measures like sanctions and tariffs "cannot facilitate peace". India's Foreign Ministry issued a statement highlighting the irony, noting that the very nations criticizing India are themselves indulging in trade with Russia. Specifically, the EU conducted €67.5 billion in trade with Russia in 2024, including record imports of liquefied natural gas (LNG) reaching 16.5 million metric tons.

Adding to the friction is the EU's proposed Carbon Border Adjustment Mechanism (CBAM), a carbon tax on imports of carbon-intensive goods like steel, aluminum, and cement. Indian officials view this mechanism as unfair and detrimental to developing economies like India. India's Finance Minister Nirmala Sitharaman has called the CBAM unilateral and arbitrary, stating that it will hurt India's exports. Commerce and Industry Minister Piyush Goyal has also expressed strong opposition, stating that India will impose retaliatory duties if the EU proceeds with the carbon tax. Under the EU's CBAM, Indian exports of steel, aluminum, and cement to the EU could face tariffs of 20-35%.

India's concerns extend beyond the immediate economic impact. Officials argue that the EU should adhere to the carbon emission rules agreed upon in the 2015 Paris Agreement, which allowed developing nations more flexible emission-cutting targets compared with developed countries. India has reduced its carbon intensity by 3.5% since 2018 and aims to achieve net-zero emissions by 2070.

Despite these disagreements, India has maintained open communication channels with the EU to negotiate a considerate position for Indian exports. India is also considering developing a domestic carbon pricing and taxation model to collect taxes on carbon-intensive exports, potentially countering the CBAM. Some experts suggest that the optimal response to the CBAM would be to impose a domestic carbon tax, starting with a lower tax rate, consistent with India's developing country status.

These developments occur against a backdrop of increasing scrutiny of India's ties with Russia, particularly in the energy sector. The U.S. imposed an additional tariff of 25 percent on Indian imports as a "penalty" for New Delhi's continued purchase of Russian oil. In response, India has emphasized its commitment to dialogue and diplomacy, suggesting that its ability to engage with both sides should be utilized by the international community to achieve peace in ongoing conflicts.